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Why Shares of AXA Equitable Holdings Soared Today

By Eric Volkman – Apr 28, 2020 at 4:46PM

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Sometimes, all a stock needs for a good day is a bump from an influential analyst.

What happened

The stock of insurer and financial services provider AXA Equitable Holdings (EQH -1.39%) ended Tuesday nearly 10% higher after it received a price-target raise from Wells Fargo analyst Elyse Greenspan. Equitable is now worth $23 per share, according to her, representing a $2 raise from her previous target. Greenspan maintained her overweight (i.e., buy) recommendation on Equitable's shares. 

Pair of hands holding an insurance policy.

Image source: Getty Images.

So what

The Wells Fargo analyst's adjustment comes a day after Equitable released its preliminary Q1 fiscal 2020 profitability figures.

For the quarter, the company is expecting adjusted operating earnings to come in at $500 million to $515 million, or $1.11 to $1.14 per share, according to the shares-outstanding count from Yahoo! Finance. That range is a touch higher than the average analyst bottom-line estimate of $1.10, again according to Yahoo! Finance.

For comparison's sake, Q1 2019's operating earnings were $509 million. 

Equitable also said in the preliminary release that it was planning to maintain its level of capital returns. In Q1, this meant a per-share quarterly dividend of $0.15, and $205 million in stock repurchases.

Now what

We're now in a time of rapidly eroding profitability across the economic spectrum, dividend cuts, and share-repurchase suspensions. In such an atmosphere, it's encouraging when a company can more or less maintain its profitability without sacrificing shareholder returns.

We'll get a clearer picture of Equitable's performance when the official Q1 results are released next Thursday, May 7.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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Stocks Mentioned

AXA Equitable Holdings, Inc. Stock Quote
AXA Equitable Holdings, Inc.
$26.35 (-1.39%) $0.37
Wells Fargo & Company Stock Quote
Wells Fargo & Company
$40.22 (-0.69%) $0.28

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